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As at 10 November 2026, interest on a final reversal of common credit under Rule 42(2)(a) of the CGST Rules, 2017 is payable at the rate notified under Section 50(1) of the CGST Act, 2017. What is…

Question and options

As at 10 November 2026, interest on a final reversal of common credit under Rule 42(2)(a) of the CGST Rules, 2017 is payable at the rate notified under Section 50(1) of the CGST Act, 2017. What is that rate?

  1. 24% per annum

  2. 12% per annum

  3. 18% per annum

  4. 6% per annum

Answer and explanation

Correct answer: C - 18% per annum

Notification No. 13/2017–Central Tax fixes the rate of interest under section 50(1) of the CGST Act, 2017 at 18% per annum, and Rule 42(2)(a) applies that rate to the late reversal of excess common credit. The 6% rate is the interest the Government pays on delayed refunds under section 56.

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